Brussels – The European Union has reached a landmark agreement to impose a fresh, bloc-wide handling fee on small parcels arriving from outside the EU, a move directly aimed at leveling the playing field for European businesses and addressing concerns over unfair competition from online retailers like Shein and Temu. The deal, finalized Thursday by the European Parliament and the Council of the European Union, represents the most significant overhaul of the EU’s customs code since 1968, according to Cypriot Finance Minister Makis Keravnos, whose country currently holds the EU presidency.
The new fee, intended to cover the increasing costs associated with processing the surge in small parcel shipments, will be levied on all goods entering the EU in small packages. While the exact amount of the fee is still to be determined by the European Commission, it has previously been suggested at around two euros (approximately $2.15 USD), a figure that will be reassessed every two years. The implementation of the fee is slated for November 1, 2026, giving member states time to establish the necessary infrastructure for collection. This reform comes as the EU grapples with the challenges of a rapidly changing geopolitical landscape and seeks to bolster its economic security.
Addressing a Growing Imbalance
The impetus for the new fee stems from a growing concern that the current system provides an unfair advantage to large, foreign online retailers, particularly those based in China, who often ship directly to consumers in small parcels. These shipments frequently bypass traditional customs checks and value-added tax (VAT) collection, creating an uneven playing field for European businesses that adhere to stricter regulations. The EU estimates that a significant portion of these parcels are undervalued, leading to lost revenue for member states.
“Systematic and repeated non-compliance will lead to stricter sanctions, up to six percent of annual imports, and the suspension of the online platform’s operations,” explained Dutch Member of the European Parliament Dirk Gotink, the rapporteur for the proposal, in a statement released by the European Parliament. Gotink emphasized that the goal is to ensure a fair market where platforms like Temu, Shein, and AliExpress are held accountable for the goods they import and do not flood the European market with substandard products.
How the New System Will Operate
The new customs code aims to streamline customs procedures and enhance cooperation between national customs authorities across the EU. A key component of the reform is the establishment of a new EU Customs Authority, headquartered in Lille, France. This authority will be responsible for coordinating and supporting the work of national customs agencies, ensuring consistent application of customs rules throughout the bloc. The authority is expected to be fully operational soon.
To prevent shifting the cost burden onto consumers, the handling fee will be paid by the same entity responsible for paying other customs duties on the parcel. This ensures that the cost is absorbed by the importer or the online platform, rather than being added to the final price for the customer. The European Commission will be tasked with regularly reviewing the fee amount to ensure it accurately reflects the costs of handling these shipments.
Impact on E-commerce and Consumers
The impact of the new fee on consumers remains to be seen. While the intention is to create a fairer market, some analysts suggest that the cost could be passed on to consumers in the form of slightly higher prices. However, proponents of the reform argue that the benefits of a more level playing field – including increased competition and higher quality products – will ultimately outweigh any potential price increases.
The new regulations also include provisions for stricter enforcement and penalties for non-compliance. Online platforms that repeatedly violate customs rules could face significant fines or even suspension from the European market. This is intended to deter fraudulent practices and ensure that all businesses operating within the EU adhere to the same standards.
Beyond the Fee: A Broader Reform
The handling fee is just one element of a broader reform of the EU’s customs code. The updated code also includes measures to improve risk management, enhance data exchange between customs authorities, and simplify customs procedures for trusted traders. These changes are designed to make the EU’s customs system more efficient, secure, and resilient.
The agreement reached by the European Parliament and the Council of the EU still requires formal approval from both institutions before it can enter into force. However, the consensus reached on Thursday signals a strong commitment to modernizing the EU’s customs system and addressing the challenges posed by the growth of e-commerce. The implementation of these changes will be a complex undertaking, requiring significant investment in infrastructure and training, but We see seen as a crucial step towards ensuring a fair and competitive market for European businesses.
The next step in the process is the formal ratification by the European Parliament and the Council of the EU, expected in the coming months. Following ratification, the focus will shift to the European Commission’s task of determining the precise amount of the handling fee and establishing the necessary systems for its collection. Member states will then begin preparing their customs infrastructure for the November 1, 2026, implementation date.
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